Recently, a few people have asked me if they can save on pet insurance, or even drop it altogether. I get it, we’re all looking at ways to cut costs right now. But pet insurance is like any other type of insurance; the premiums can add up and have you questioning if it’s worth having – until you need to make a claim.
My advice: make sure your pet insurance meets your furry family member’s needs, without overpaying. Do your homework and if it’s comparatively expensive, it could be time to switch providers.
Here’s a few things to know about pet insurance:
Why insure your pet?
We insure our homes, cars, and health, so why not our pets?
Previous generations would have sent a domestic pet to the proverbial “farm” rather than pay big vet bills. For many of us today, our animal companions are like our kids – and just like human dependents, they can cost us a lot!
I have a friend who’s French bulldog had serious health issues and the vet bills were the equivalent to buying a new car.
When some emergency vet bills can climb into the tens of thousands, pet insurance could mean the difference between keeping or losing a beloved animal.
Pet insurance covers 70-90 per cent of vet bills for sickness, injury, or emergencies. Coverage options include:
- Accident and illness: Covers treatment for illnesses (like cancer) and injuries.
- Routine care: Optional coverage for vet visits, vaccinations, dental care etc
- Accident-only: Covers accidental injuries, the most affordable option.
Pet insurance premiums on the rise
Australia has one of the highest pet ownership rates, with 28.7 million pets – dogs being the most popular. The pet insurance market is worth $1.1 billion and growing at 14 per cent annually.
But with pet insurance premiums increasing by about 20 per cent a year (compared to human health insurance – which recently rose by 3.73 per cent), it can be a financial burden.
Like other general insurance, though, we need to remember pet insurance is risk-related. This means the cost is calculated on ‘risk factors’ such as breed, age, product coverage, claims history and much more.
Consider this: Dogs age faster than humans… one human year is equivalent to 5.3 dog years. As such, the chance of illness and therefore a claim, increases the older our best mate gets.
Our pets are also not covered by Medicare or the Pharmaceutical Benefits Scheme (PBS) – which subsidises medicines. Their healthcare costs are 100 per cent on us as owners.
The good news is with so much provider competition these days, we can and should be savvy consumers.
Crunching numbers
According to Compare the Market, the cost of insuring our furry friends differs greatly across not only ‘risk factors’ but also providers.
For instance, they found a Maltese Cross can be insured for as low as $360 annually, while coverage for the most expensive-to-insure dog breed – a French Bulldog – started at $908.
At $2.50 a day, that’s still less than a cup of coffee. But I also know most people like their daily coffee (me included)! So, here are some pet insurance hacks to save.
8 ways to save on pet insurance
- Don’t wait: Insure your pet early, ideally within their first year, as this is when most health problems arise. It’s harder to get insurance for pets with pre-existing conditions.
- Shop around: Premiums vary greatly, and shopping around could save you hundreds – or even thousands – over the years. Compare policies to find the best value. One Compare the Market expert found a nearly $900 annual difference between policies with varying benefits.
- Read the fine print: Check if your pet’s specific conditions are covered in your policy. Pets with pre-existing conditions won’t be covered by a new policy.
- Understand the limits: A low-cost policy may be attractive, but owners should make sure that it suits your pet’s needs. For this reason, pay attention to annual limits, sub-limits, coverages, add-ons, and excess (which is the amount you’ll pay when claiming, in addition to the benefit percentage gap).
- Review your policy: The time to save on pet insurance isn’t just when you take out the policy. Avoid nasty surprises by regularly checking your pet’s policy to ensure that the product is still the right fit for you.
- Consider a higher excess: You can lower premiums by selecting a higher excess, but this means you’ll pay more in the event of a claim. Consider whether this option suits your needs.
- Consider adding ‘routine care’: Routine care helps cover some of your pet’s preventative care expenses like vet check-ups, vaccinations, and dental treatment. This can help avoid big surgery and hospitalisation bills later on.
- Keep your pet healthy: Regular exercise, a healthy diet and other preventative care measures can also help to reduce the likelihood of needing to claim. Plus, you’ll have a healthier pet who will hopefully live a long and happy life.
Pet insurance can provide peace of mind knowing you won’t have to bear the cost alone of unexpected vet bills, but be smart about it. Like all types of insurance, it pays to shop around.
